Du Pont Millions at Issue In an Heir's Sanity Case

By MICHAEL deCOURCY HINDS, Special to The New York Times

Published: January 29, 1990

PHILADELPHIA, Jan. 28—
A du Pont heir who once ran for Congress is back in court here trying to prove that he is sane and competent.

In 1986 a judge agreed with his parents that he was mentally ill, incompetent and likely to squander his $10 million fortune on the political organizations of Lyndon H. LaRouche Jr. The son was placed under the control of a financial guardian.

In any family, such struggles are painful and perplexing. But with the dispute involving a branch of the du Pont family, one of the wealthiest families in America, the story has taken on added drama, with talk of Cartier diamonds, grand pianos and gifts of hundreds of thousands of dollars.

''No one deserves to go through what I've been through,'' said the heir, 33-year-old Lewis du Pont Smith. ''Anyone who can cook gnocchi alla Gorgonzola cannot be incompetent.'' He had just prepared the Italian dish of potato dumplings and cheese for his wife and a guest.

As a person declared legally incompetent, Mr. Smith was unable to vote when he lived in Virginia and needed the court to validate his marriage three years ago. He says he lost $3.3 million in the 1987 stock market crash because the court had not let him rearrange his portfolio.

'Stigma on Our Marriage'

''It's terribly humiliating,'' he said. ''Why should I have to defend my mental competence to my family, or to a court where my political beliefs are on trial?''

His wife, 25-year-old Andrea Diano-Smith, who is a canvasser for Mr. LaRouche, added: ''It's a stigma on our marriage, and I will not have any children until I'm rid of that stigma. I am afraid the family would try to take the children away from us. They have already sought to have a guardian appointed for our unborn children.'' The Smiths live in Nashua, N.H.

Mr. Smith's parents, E. Newbold Smith, a securities analyst, and his wife, Margaret du Pont Smith, who live outside Philadelphia, assert that their son is mentally ill and has fallen prey to a cult, as they view the LaRouche political movement.

Mr. LaRouche, a perennial Presidential candidate, has won a following with his eclectic theories of international conspiracies, industrial reforms and right-wing social policies. He is now serving a 15-year prison sentence for conspiracy to evade taxes, commit mail fraud and other Federal offenses associated with fund raising. Mr. LaRouche, who served as best man in the Smiths' wedding, is expected to testify on Mr. Smith's behalf.

Ran in a Primary

Lewis Smith joined the LaRouche organization in 1985 and gave it $212,000. In 1988 he ran as a LaRouche Democrat for a New Hampshire seat in the United States House, calling for universal testing for AIDS, support for nuclear power plants, additional farm subsidies, a war on drugs and colonization of the Moon and Mars. He lost the primary, getting 8.5 percent of the turnout, or about 10,000 votes.

Newbold Smith has previously said the case is ''not Smith vs. Smith, but Smith vs. LaRouche.'' He and other family members declined to be interviewed.

It was after Lewis Smith's initial $212,000 donation that his parents went to court. The 1986 ruling declaring him incompetent was upheld in appeals of technical points that reached the United States Supreme Court, which in 1988 refused to hear the case.

In his new case, Mr. Smith is returning to the same court, the Orphans Division of the Court of Common Pleas in Paoli, where his parents live, and asking the same judge to reverse his earlier decision.

In a two-and-a-half-hour interview, conducted at the kitchen table in his mother-in-law's row house in South Philadelphia, Mr. Smith told his side of the story with clarity, anger and humor.

''Money is the family blood,'' he said. ''Passing money down through the generations defines parental responsibility in the du Pont family.''

From his perspective, his close ties to his parents and siblings were ruptured by their disdain for his new political beliefs and their concern that he was wasting his inheritance.

Lewis Smith grew up surrounded by wealth and privilege. He attended boarding schools from the time he was 11 years old and won a full football scholarship to the University of Michigan. There are disagreements over whether he has a severe learning disability and whether he became severely depressed after a back injury prevented his playing college football, but his lawyers say he has never had a mental breakdown nor sought psychotherapy.

Several Short-Term Jobs

After college, Mr. Smith had difficulty establishing a career. He dropped out of graduate school, where he was studying history, and held several short-term jobs. He was teaching seventh-grade history in Philadelphia when he became interested in the LaRouche movement.

A psychiatrist hired by the family testified in 1985 that Mr. Smith was mentally ill and suffered from a schizo-affective disorder, which he said was essentially schizophrenia.

A psychiatrist hired by Lewis Smith testified that Mr. Smith was mentally competent, but had a mixed personality disorder. Such a disorder involves inflexible, maladaptive personality traits that can cause distress, according to the American Medical Association's Diagnostic and Statistical Manual of Mental Disorders, which was cited in the hearing.

Judge Lawrence E. Wood, who presided over the 1985 hearing and is presiding over the new one, wrote in his 1986 decision: ''We conclude that Lewis does indeed suffer from a personality disorder, of sufficient severity that it has significantly impaired his ability to manage his personal and financial affairs in a way appropriate to his interests.''

Judge Wood appointed a Delaware bank to act as Mr. Smith's financial guardian. Under this arrangement, Mr. Smith now receives $15,000 a month and needs court permission for additional expenses, like a $31,000 Cartier diamond wedding ring he got for his wife and a $5,600 grand piano.

In the new case, Lewis Smith's lawyers are trying to show that Judge Wood's interpretration of mental illness was too broad. ''I smoke cigarettes, and that is listed as personality disorder in the classification manual; does that make me incompetent?'' said James B. R. Crummett, one of Mr. Smith's lawyers.

The family's lawyer, David S. Foulke, would not discuss the case, but said he planned to call only one witness, Dr. David A. Halperin, a Manhattan psychiatrist and specialist in cult organizations that the family hired to examine Lewis Smith in 1985.

''My testimony in 1985 still stands,'' Dr. Halperin said. ''Lewis du Pont Smith has a severe mental illness, and I don't feel he can manage his affairs. That is based on my psychiatric evaluation, and it has nothing to do with the LaRouche organization that he is following. But he joined the organization as an expression of his mental illness.''

photo: Lewis du Pont Smith, who has asked a Pennsylvania court to reverse its 1986 ruling that declared him incompetent and placed him in the care of a financial guardian, with his wife, Andrea Diano-Smith. (NYT/Dan Miller)